Does Technology Affect the Value of the Trains We Own? Help Me with Your Insights!

We're already seeing it.  Preowned conventional, PS1, PS2, TMCC locomotives go for cheap as folks become enamored with the new electronic and detail features on rereleases.

There may be a narrow market of collectors that value the early generation electronics, but for most, the internal electronics have about as much "collector" value as a Betamax VCR.

Rusty

I only buy them when 'busted' for cheap and throw all the electronic crap away and run them 'post-war'. So I don't put any value on the technology which is only good when it works and judging by the comments on this forum isn't very often. 

It does for me.  As Rusty stated PS1 locomotives are basically sold for scrap; if you can get rid of them at all.  I do not buy trains with the latest and greatest electronics.  Like technology in other areas, the prevailing attitude seems to be that these are throwaway items.  Like your flat screen TV; when it breaks down, you replace it rather than fix it. With the tech changing so fast there is a lot of concern about whether parts will even be available down the road when (not if) needed.

Jeff Davis

IMHO, the TCA grading system does not need to be changed. A second, separate grading system could be established for the operational condition of the train.
There are still plenty of us who aren't interested in technology, and we do not need to be burdened with such a grading system.

How would such a system be defined? Would an older technology that is fully functional be graded lower than a newer technology with more features?
I think it has to be up to the buyer to know what they are buying when it comes to functionality, features, and compatibility.

If all the features work as designed, regardless of what those features are, then the item has to get a top rating.

I have the parts and know-how to fix just about anything on my trains; so I generally don't get hung up on the reliability of the technology.  However, having said that, I pretty much consider my purchases a dead-end as far as an investment is concerned.  I have no intention of selling off any of my trains; that activity I will leave to someone else to manage 5 minutes after I'm off on the next adventure.  So from my perspective, I definitely like the new technology, and it does influence my purchasing decision, I just don't worry about the long term ramifications of owning something that will be considered obsolete in short order.

For me if the engines are mechanically identical with the same detail like an MTH PS1 vs PS2/3 engine, the latter is worth more.

On the other hand an identically priced detailed command engine like a 3rd Rail Hudson is worth more to me than a Vision or PS3 Hudson.

Detail trumps electronic features in my book. 

Pete

Ed,

Great topic for some future articles.  I think there are several points....

1.  Grading standards.  Pre-electronic trains could easily be graded by site.  There was nothing else to go wrong except a good cleaning, some new wires.  All basic stuff which would bring the item back to life.  One could easily see if bushings were bad, gears worn etc.  You can't tell if electronics are bad.  Buying a current item today with bad electronics is tough as the engine will not work without some serious work or after market replacement parts.  I think grading standards will need to address this in the future. 

2. Items are being remade with newer features all the time.  That quickly kills the value of its predecessor.  Just look at the Lionel M1'a.  The originals (TMCC) can be had in the $500 range since the new legacy models are $800+  How can the older model compete price wise?

3. A can see a new collector niche developing.  There will be collectors who want a specific electronic version in original working order.  The early models will become more rare as people upgrade older models to get newer features without buying the new model.  I see this as a small group as most people prefer the latest and greatest.

4. Longevity is a serious consideration.  I have no issues running my dad's pre-war trains.  I keep them well tuned and greased.  They will last and run well past my lifetime.  My new stuff with all the electronics may not.  Operators may have more reservation to firing up an engine with electronics that are 80+ years old.  This could affect collectability in the future for said models.

5. Part availability affects prices to.  If someone wants to keep an item all original, they will be hard pressed to find original boards to replaced dead ones.  The various speed control boards/sound boards are not easily duplicated.  On the other hand, I can find plenty of after market castings for various postwar trains and even original parts as Lionel Corp made tons of parts.

The key is how much hardware (engines, accessories, etc) can be improved by software upgrades before the hardware itself becomes obsolete.

After being a Post War Lionel collector for years, I sold my huge collection through Stout Auctions. I really couldn't get out of the hobby so I switched tracks and went to more modern Lionel.. The first thing I see when kids come in now is where is the remote? I hand the remotes to the big eyed kids, and they play forever. when  I had the ZW's, they didn't pay much attention whats so ever. to me it's for the kids and to bring them up loving the hobby.

Ed, I am still somewhat of a collector of conventional engines such of those by Williams (Gold Edition) and Weaver, but I prefer command engines.  So I have my traditional engines retrofitted with TMCC (ERR) or PS2 as necessary. Command engines of whatever vintage allow me to wander the layout, talk with guests, and catch or service potential problems.  Of course, their is much to be said for the latest technology such as Legacy or PS3, and I enjoy their creative options.  But command functionality is my baseline.  Thanks for bringing up the topic.

Keith

Absolutely, as one of my colleagues stated after seeing  my American Flyer Postwar collection on my display shelves:

"Wow! Look at all these dead engines".

I asked what do you mean they work flawlessly. And he replied " Yes, but they don't have TMCC."

Personally, I have little interest in post war items.  The latest Lionel and MTH models are more my speed because I really like all the new detail, electronics and features.  But it is a double edged sword... in another 7 years there will be another big feature or operating system addition that is a must have.  This will render the older models less valuable, sometimes below a third of their intro street price.

Technology has a major impact on the value of trains. When I purchase an engine I want to see the condition it is in but I also want to know what electronic package is in it and does it work. I will pay lower percentage below MSRP for a PS1 engine than I would pay for a PS2 engine. I also need to know that the engine runs and the sound is working. The LCCA rating is no longer adequate to assess the value of the engine. A good looking engine that has flawed electronics is not worth much. 

In popular opinion, YES Ed, I can see why it is. But I tend not to get wrapped up in that most of the time.

I collect mostly 1970-2000 modern Lionel and postwar Lionel, with a few more current MTH and Lionel products that have much more sophisticated gadgets inside. While they certainly do retain a higher price in comparison, they too almost always depreciate with every passing second. One MTH Premier Mikado with Proto2 from 2007 I got was only $475 - way below it's $900 price tag!

Sometimes you have to look at the opposite end of the spectrum, too - those engines with more intricate features are going to be more of a nightmare, at least price wise, when something goes wrong with them.

I have the Lionel LTI-era scale 700E Hudson, and has had no electronic problems whatsoever, and is still running perfectly the same way it was 25 years ago. Compared to the Vision Hudson, which has has 2 unique electronic problems in the past 4 years I've owned it, and both repairs were worth as much as a RailKing steamer! For me, reliability comes long before sophistication.

Not only that, but those items that do get depreciated by newer versions make them easy bargain buys for those who just want the engine. It also makes them fun to tinker with. I have a few MPC era Lionel steamers I've planned to upgrade with better parts and extra detailing. They're much more fun for me than the new, scale Legacy versions, like the Alton and Blue Comet.

As for the newer equipment, I give it at least a few months before its value starts going downhill, because everyone knows something better will come soon to push the once new stuff out of the spotlight. I mean, the Legacy GS-4 is even going down in value with the new GS-2 models Lionel recently rolled out! The toy train hobby in the last 20 years has become much more like the rest of the electronic world than ever, comparing to things like Playstations and HDTV's.

Firstly, thanks for asking us, Ed.

As far as functionality/new stuff, I go back to "why choose O-gauge?" I did because of the functions: bells, smoke, accessories, track side gadgets, etc. If not for this (and the relative "electrical ease" of having 3 rails on the track) I should probably be in a smaller gauge with more powerful glasses in the same floor space in order to have a "larger layout."

If one starts with the premise that O-gauge has all this functional "stuff" that adds to realism, then one must ultimately conclude that somehow, this "technological functionality" should be incorporated into a "rating" (i.e. grading) scale of trains offered for sale/resale. Technology will only continue to improve; who knows what will happen in 10 years?

So I would think that LCCA would want to develop a system, with the ability to incorporate as yet not thought technological advances, that grades technology/functionality somehow for those who, like me, prefer O-gauge for its gadgets/activity/"realism." For those not interested in technological functionality, it would be a detail with which they need not concern themselves (with no disrespect intended toward the conventional operators).

You asked....

Regards,

Bruce

I don't see the big deal here. In most instances the electronics can be swapped out and updated to the latest. This will be available most likely as long as there is an interest in there hobby. Most likely every 3 years the electronics will be antiquated anyway. 

I do no see any antique value in the electronics at all after post war era stuff. Most people would not care,they just want the loco to run.

I run conventional, many forward only. For that a bridge rectifier is all the electronics needed with some LEDs for lighting and RS4 stand alone boards works well if I want sound. You are looking at a bit over $100 for the whole upgrade (or downgrade in the eyes of some.  I buy locos at half MSRP or less. The cheaper the better,I don't care about the electronics because I can run anything mechanically sound as stated with a rectifier and RS4 board. 

In general I think investment expensive train electronics is a waste of money. They are not reliable , expensive to repair with sometimes non existent extinct replacement parts. In 3 to 5 years,whatever you buy will be obsolete. Even on newer engines,from what I have read here service is less than stellar. 

Dale H

Since technology is getting more sophisticated then the older systems are worth much less due to just having the electronics. Technology has changed the market from collecting to operating. Operators always want the newest and do not want old tech. As long as this is part of the hobby the bell curve in lowering values will be more pronounced. Who wants to run an old computer? No one so they are worthless. Our trains have some value as a model which dampens the curve a little.

Yes, the technology does affect what I would pay for trains.

First off, I'm an operator. I like to "collect" the items I like, regardless of roadname, but I run 'em all.

It would be nice to have a second or sub-class of TCA-type grading standards for the new electronics, but I really don't see any way to have significant quantifiable differences. As an example, at a meet, Joe Seller is not going to want to pull the cab/shell off a loco to prove that the boards inside are original Lionel. So basically it works or it doesn't. Perhaps have some "levels" of functionality assigned?  As in, if it's electronic with smoke whistle and bell, and all 3 work, then it's a 10. If it has smoke/whistle/bell/sounds/crew talk/whistle smoke/steamchest smoke/moving crew/directional lighting/cab lighting, if all work except the smoke out of the stack, is that a higher grade than one where everything works but the cab lighting, crew talk, and moving crew do not?  Very subjective....

Secondly, would anyone even *know* if the board they're seeing is a Lionel board or not (I've never really looked to see if Lionel or other brands are etched into the boards themselves)?

Personally, I'm thrilled that the PW and early electronics are suffering price-wise, because I still want to obtain several beloved items from my youth.  30 years ago, they were untouchable, but now are within reach.

I have to sing with the chorus here.  Technology is a big part of why I came back to the hobby.  Like others, sometimes I buy a desirable model with older electronics, or none at all, and upgrade it to the latest features.  However, even that isn't perfect, take the example of the new Lionel Legacy stuff with the IR sensor for the LCS sensor tracks.  That's not available for retrofit, so I'm looking for newer stuff that has that capability.

Ed,

Technology affects the value great deal to me. I don't even consider buying a train unless it has speed and command control, as well as a good sound system (PS2.0 or RS4.0 or greater). I wouldn't even pay 10% of an older train's original price ~ that is, a train with PS1 or original Railsounds. The hassle of upgrading electronics is just not worth my time. I am not a collector, so my opinion has some bias.

The flip-side of the above is that there is a limit I place on what I'll pay for technology in electric trains. Case in point was Lionel's Big Boy at ~ $2,000. Its state of the art features are great fun but I cannot justify that kind of cost.

Well Ed, since your talk is tomorrow night (unless you mean NEXT Wednesday), you didn't leave yourself much time here.

That said, to me it's kind of like adding another forum topic: If folks don't pay attention, what's the use of an additional forum.

Likewise, it's easy to go to a train meet or an auction site, where trains are listed as mint yet are obviously used. Or like new, and they're covered in dust. Adding another category to grading standards will not make people become any more accurate or honest about how they perceive the condition of their trains.

Obviously, today's trains have more electronic features, and therefore have more that can go wrong. To me, and I agree, the current grading system seems to have a visual implication first, and yet the functionality is not excluded. If something is LIKE NEW that means it not only LOOKS like new, but it also operates like new.

I can see where some confusion could arise with categories below "like new" on the grading scale. "Good condition" implies there are obvious signs of usage. And here I see your point, where a visual assessment differs from an operational assessment. Especially on any high end locomotive with many features. For that matter, even a regular LionChief engine. If the sound or smoke doesn't work, it's not like new, even if it appears visually to be like new.

I don't know how a new grading system would work, especially on the modern stuff. Parts are far more limited today as well as quantities made. Here's a real advantage of almost anything pre-modern: Production runs were larger, therefore parts are more universal and accessible (meaning repairs are more practical).

Mechanical e-units certainly can have their quirks, but they are totally fixable. A circuit board is another story, unless you have a degree in electronics or just a lot of attained knowledge - as there are a few on this forum.

To me first and foremost, it's a matter of the seller being honest - which does not always happen. So then what to do? Next, it's become more necessary for the buyer to be knowledgeable of what they are buying, to do their homework, to be cautious and ask questions before making a purchase.

A scenario for honestly: If a high end locomotive, for example, has been repaired with lets say a replacement sound system or an improved smoke unit - which is better than when purchased new - it is now, by the current grading standards, no longer new or like new condition. Even though operationally, it could be vastly improved.

Regardless of any new grading system, today the weight is more on the consumer to be in the know of what they want to buy. If a seller cannot answer a question, doesn't know, or simply won't tell you - regardless of the vintage or features of the trains - the best idea would be to pass. As they say, buyer beware, which has become more true than ever.

I think Joe's point #3 is interesting. While I agree that, currently, trains with the older electronics (TMCC, PS1) generally are not particularly valuable, I wonder if there may be a market down the road for certain fully-functioning examples in good shape. There is a collectors market for old computers and video game systems and games nowadays (at least for specific ones that are rare or historically significant), so outdated electronics are not necessarily a death sentence when it comes to value. Whether the same dynamics can apply to trains is a question, though.

Derek

quote:

Obviously, today's trains have more electronic features, and therefore have more that can go wrong. To me, and I agree, the current grading system seems to have a visual implication first, and yet the functionality is not excluded. If something is LIKE NEW that means it not only LOOKS like new, but it also operates like new.

The TCA standards, which have been just about universal adopted, specifically exclude operating condition.

Technology is what brought me into this hobby.  My brother was into pre-WWII Marx and my father-in-law enjoyed conventional O gauge trains.  However, while it was fun to play with these trains with them, I had no interest until Lionel came out with RS.  I bought a couple of RS engines and ran the engines when I visited them.  Then came command control, and I was hooked.  I built my first layout centered around the advantages of TMCC.  The only conventional trains I have are trains I inherited, and they are in storage.  My layout has no transformer "throttle" handles; if I should run conventional it will be through the Power Masters.

All my engines (even B-units) have command (TMCC or DCS), sound, and if a steamer 4-chuffs per revolution.  To get this in my older engines, I had the old electronics either upgraded or replaced.  Initially it was TAS or PS2, now its ERR stuff.  I have a couple of engines where I have upgraded them twice, and another one where I'm going to remove a poor TMCC/Odyssey system and install a full ERR system. 

I would like to see a grading system for functionality.  This would be important to me if it is a recent issue with the latest electronics.  But mostly I would use a grading system to make sure the motor(s) are good and the running gear works well; the mechanical parts of the engine.  I will more than likely upgrade or replace the electronics in the engine after I buy it.

I will probably always be looking for better electronics that make the engine run as realistically as possible for a model.  At this point I do not plan on buying many more engines, but continuing the upgrade of my current ones.  If Legacy were to be offered as an upgrade kit, I would replace my older TMCC stuff with it in a heartbeat.  I may keep the old stuff for parts, or just throw them away.

I agree that level of  tech changes desirability to many operators and thus their worth on the market. You can see it on any forum (like Ebay) where the older tech-equipped models command (pun intended) less money.

Old, reliable postwar models are, of course, an exception and have a different set of metrics to measure their worth.

"The TCA standards, which have been just about universal adopted, specifically exclude operating condition."

Thanks CW, I was unaware of that. I'd always just assumed that if something is like new, it not only looks like new, but operates the same. Or maybe it's just the way I read the descriptions. As in the following C-7 and 8 descriptions, I read the mention of parts as mechanical. But I can see how that could mean just visual pasts (and not mechanical), such as a snap-on dynamic brake, or a brake wheel or decorative horn or bell.

C-8 Like New—Complete all original: no rust, no missing parts; may show effects of being on display and/or age; may have been run.

C-7 Excellent—all original: minute scratches and paint nicks; no rust and no missing parts; no distortion of component parts. 

So I guess it makes Ed's idea even more justified, especially in this day and age.

Dale H said "In general I think investment expensive train electronics is a waste of money. They are not reliable , expensive to repair with sometimes non existent extinct replacement parts. In 3 to 5 years,whatever you buy will be obsolete. Even on newer engines,from what I have read here service is less than stellar." I tend to agree with this statement.  I think grading electronics is fraught with problems, apart from them either working or not, they will eventually fail, even if not used. This must have a generally negative effect on long term valuation compared to classic pre and post war trains, and I'm including European and British in this, where they retain or in some rare cases, increase in their values.

Like many others here I gradually abandoned my post war trains in favor of the newer scale models with good sounds and control. Initially I was happy with much of the Lionel and MTH Premiere stuff from the early 2000s but as I became more knowledgable I could see and hear the difference in the improved detailing and better sound of the more recent items. 2 chuffs per sounded bad and the older smoke units didn't sync with the chuffs.

Even so, I would probably concur with Norton above that detail will trump electronics in most cases - electronics theoretically can be upgraded.

I think you are going to see 2 distinct camps here with possibly a sub set in one class.  There will be the pure conventional (post war, WBB) folks who enjoy the trains and could not be bothered with the technology.  They are actually in a great place because the technology is driving the price of those items down making the hobby far less expensive.  Then there is the technology driven folks, the ones who look for smoke, sound, lights, working bathrooms, the works and are willing to pay on the order of a grand or more for that tech.  It is hard to say how much of a market share that customer bases provides.  Perhaps the folks at Lionel and MTH could share the number of units sold of some selected high end units.  The subset may well be folks like me, first generation command or conventional.  All of those items have certainly lost value.  In some cases I would be luck to recover 1/3 of the purchase price for what I paid new.  In other cases I have been fortunate to pick up some very nice pieces at much less than the original probably because the original owner is upgrading.  So the answer is the high end stuff has a higher purchase price and will likely maintain value because there is no replacement.  The stuff prior to Legacy and PS3 will all lose value to a point.   I would frame the talk as "it depends".

quote:

Thanks CW, I was unaware of that. I'd always just assumed that if something is like new, it not only looks like new, but operates the same. Or maybe it's just the way I read the descriptions. As in the following C-7 and 8 descriptions, I read the mention of parts as mechanical. But I can see how that could mean just visual pasts (and not mechanical), such as a snap-on dynamic brake, or a brake wheel or decorative horn or bell.

In the second half of the 1970's I obtained an absolutely brand new Modern era Lionel locomotive (current model) that I am positive had never been removed from the box before I did.
The engine was not functional because the e-unit had fallen to pieces inside the locomotive.

 "I think grading electronics is fraught with problems, apart from them either working or not, they will eventually fail, even if not used. This must have a generally negative effect on long term valuation compared to classic pre and post war trains"

   Collector value is determined by supply and demand which is a function of number made and attrition due to time it's been since they were made.Small production numbers and no one saving them as collectibles along with sufficient demand to drive up the price is a necessary condition and I don't see that happening with today's production numbers and number of buyers who buy them as collectibles, the scarcity per person wanting the item will not be there in 50 years if all the production is collected for that purpose. Bottom line is run them as toys if you want and don't worry about what the TCA or any other group thinks about their worth, and best way to get value from the stuff is learn how to keep it running yourself so you are not dependent on distant resources. ....DaveB

I suspect operators have always felt the technology was the major driving force behind their interest. First it was the novelty of an invisible force causing a train to go around a track. Later it was the innovative-for-the-time accessories that could light, make noise or perform a task without manual assistance. Now it is blowdown or whistle steam, track sensors, etc. Will these features significantly influence the long term collectabilty or associated value of an item? I doubt it. I still think it will be the traditional factors like nostalgia, rarity and beauty that influence what collectors are willing to pay. 

My 2 cents...

I think that the first train club that establishes some kind of grading for operation will set itself apart from the others.  

Here's a quick stab at how operating condition could be graded as follows (regardless of generation):  5) fully functional  4) some functions work, some don't  3) doesn't work, but all parts are present, 2) doesn't work, parts missing, 1) inoperable, R) restored/modified operations

I see this as a separate rating, much like TCA's paper/box scale.

I think the collectible aspect of the hobby is over.

romiller

Ed,

    There are 2 different kinds of technology minded owners you might want to consider.  The conventional technology that a lot of collectors like and the modern technology that all the younger generation loves.  For engineers like myself I like modern technology on Tin Plate Trains kid of combination of both worlds, now I am not about to change my Fathers original 263E Tin Plate Lionel work train for any one, however I am having Guns (Gunrunnerjohn) up grade the smaller 249 version of this Tin Plate Train with ERR controls adding the new technology to my Tin Plate.  I love being able to run all the different trains with my DCS hand held remote control technology, dreamed of doing so even as a kid, combining the old ZW & KW transformers, with the DCS and Legacy technology is great engineering to me, adding the new Z4K's & ZW-L's for modern power technology improves everything, no doubt about it.  For me it's about combining the old and new technology of our hobby that makes everything so special.  

PCRR/Dave:

:

On my RR, I have upgraded all my early NYC MPC, Williams engines to TMCC so they are not shelf queens, my PS 1 engines are now PS 2 and have joined the DCS world. The exceptions for me are early brass NYC Williams engines and my ROW engines, the collector in me wont let me touch them. I am not in this great hobby as an investment but for pleasure, the value will be gain for those I leave behind in this life. None of this takes into consideration the custom work I have done thru the years for my pleasure and others as well. A grading system for the technology upgrades interests me (eg for conversation, a MPC 783 Hudson bought new at say 695.00 at the time is worth today 350.00 now if I add TMCC to the old engine its worth ????? Food for thought. To me priceless. Ed great topic!!

I can't stand diesel locos without prime mover sounds and reliable, slow-speed operation.

I also wish that the PS2 locos I own were PS3 so I could run them on DCC.  

Yes I need tech in my trains.

everyone on here repeats " buy trains because you like them"- not for an investment or value purpose. yet this magazine still has a collectors corner column advocating whats valueable and whats not,whats rare, etc. i guess i keep getting two different messages here . -Jim

The older the technology, the less it's worth.

Simple really.